Australian PM surprises with September election call

Reuters, CANBERRA

Thu, Jan 31, 2013 - Page 6

Australian Prime Minister Julia Gillard set national elections for Sept. 14, stunning voters yesterday with eight months notice of the vote in a bold move designed to end political uncertainty surrounding her struggling minority government.

The election date means Gillard’s government will serve a full three-year term, although analysts said the early notice meant she had started an eight-month campaign and lost her ability catch opposition leader Tony Abbott by surprise with a snap early poll.

“She’s going for the strategy than an incumbent can wear out a fragile, or potentially fragile, opponent with a long campaign. The idea is for them to punch themselves out,” analyst Paul Williams of Griffith University said. “In this case, Tony Abbott and the opposition are so well entrenched it will backfire.”

Opinion polls show Abbott’s opposition Liberal-National Party is well ahead of the government and Gillard would be swept from office, losing up to 18 seats, if an election were held now. The government could lose power if it loses just one seat.

The election will decide whether Australia keeps its controversial carbon tax, and a 30 percent tax on coal and iron ore mining profits, which Abbott has promised to scrap it if he wins power.

However, apart from these two policy differences, the government and opposition differ little on domestic issues and both firmly support greater involvement with China, the country’s biggest trade partner, and close defense ties with the US.

The financial markets were unmoved by the announcement.

The Australian dollar remained firm, hitting its highest level against the Japanese yen in more than four years. The stock exchange reached a fresh 21-month high and government bonds were steady.

Abbott said he was ready to fight the election, adding that it would be decided on Gillard’s credibility.

“This election will be about trust,” he said, hinting he will focus on Gillard’s broken promise not to introduce a carbon tax and failure to deliver a promised budget surplus this year.

Abbott has successfully eroded government support through his constant negative attacks, but has yet to make any detailed policy announcements. He is due to make his first major speech this year today.

Business said it welcomed the early announcement of the election date, but said it would not have much of an impact on certainty given the date falls within the normal election timing.

“Its real value is the knowledge that the last quarter of the year will be uninterrupted by an election,” Australian Chamber of Commerce and Industry chief executive Peter Anderson said.

Gillard currently governs with support from a group of independents and the Greens, who all support the Sept. 14 election. That means she has locked in majority support until the election, although a sudden by-election could still change the balance if a lawmaker dies.

Under Australian laws, governments serve for up to three years and the prime minister decides the election date. Gillard said she wanted to end political uncertainty by setting a date.

“It is not right for Australians to be forced into a guessing game, and it’s not right for Australians to not face this year with certainty and stability,” she said in a speech to the National Press Club.

Her speech laid the groundwork for an election battle focused on the economy, arguing that a strong economy is necessary to ensure fairness in education and disability services — two key policies aimed at Labor Party heartland voters.

Gillard said the governor-general would dissolve parliament on Aug. 12, giving the government two more sessions of parliament to pass laws and deliver its budget.